Ex Parte Adcock et al

Patent Trials and Appeals Board

Nov 13, 2018

14029087 - (D) (P.T.A.B. Nov. 13, 2018)

UNITED STA TES p A TENT AND TRADEMARK OFFICE
APPLICATION NO. FILING DATE
14/029,087 09/17/2013
35811 7590 11/15/2018
IP GROUP OF DLA PIPER LLP (US)
ONE LIBERTY PLACE
1650 MARKET ST, SUITE 4900
PHILADELPHIA, PA 19103
UNITED ST A TES OF AMERICA
FIRST NAMED INVENTOR
Paul D. Adcock
UNITED STATES DEPARTMENT OF COMMERCE
United States Patent and Trademark Office
Address: COMMISSIONER FOR PATENTS
P.O. Box 1450
Alexandria, Virginia 22313-1450
www .uspto.gov
ATTORNEY DOCKET NO. CONFIRMATION NO.
NGI-l4-l090R3DIV-DIV-DIV 5399
EXAMINER
FU,HAO
ART UNIT PAPER NUMBER
3697
NOTIFICATION DATE DELIVERY MODE
11/15/2018 ELECTRONIC
Please find below and/or attached an Office communication concerning this application or proceeding.
The time period for reply, if any, is set in the attached communication.
Notice of the Office communication was sent electronically on above-indicated "Notification Date" to the
following e-mail address(es):
pto. phil@dlapiper.com
PTOL-90A (Rev. 04/07)
UNITED STATES PATENT AND TRADEMARK OFFICE
BEFORE THE PATENT TRIAL AND APPEAL BOARD
Ex parte PAUL D. ADCOCK, MICHAEL A. CORMACK,
AMY FARNSTROM, and ROBERT A. HILL 1
Appeal2017-001617
Application 14/029,087
Technology Center 3600
Before WILLIAM V. SAINDON, JENNIFER L. McKEOWN, and
JOYCE CRAIG, Administrative Patent Judges.
Opinion for the Board filed by JENNIFER L. McKEOWN,
Administrative Patent Judge.
Opinion Dissenting filed by JOYCE CRAIG, Administrative Patent Judge.
McKEOWN, Administrative Patent Judge.
DECISION ON APPEAL
Appellants appeal under 35 U.S.C. § 134(a) from the Examiner's
decision to reject claims 50-60 and 70. Claims 1--49 are canceled and
claims 61---69 are withdrawn. We have jurisdiction under 35 U.S.C. § 6(b ).
We reverse.
1 The real party of interest is identified as NYSE Group, Inc.
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Application 14/029,087
STATEMENT OF THE CASE
Appellants' claimed invention is directed to "[a]n enhanced system
and method for handling, matching and executing a diverse group of limit-
priced orders in an electronic options environment []." Abstract.
Claim 50 is illustrative of the claimed invention and reads as follows:
50. A market center computing system which lists a
plurality of options series and handles automatically repriceable
orders, comprising:
(a) one or more data structures defining an order book for
each option series and a market maker quote book for each
options series which are maintained by an order matching
engme;
(b) one or more data structures defining an away market
best bid and offer book that is separate from the order book and
the market maker quote book and is maintained by an away
market quote engine;
( c) at least a first interface for receiving orders, a second
interface for receiving quotes and a third interface for receiving
a top-of-book best bid and offer disseminated quotation from a
plurality of away market centers for each option series;
( d) a market center memory for storing code for analyzing
and processing orders and quotes;
( e) a processor for interacting with the interfaces, the order
matching engine and the away market quote engine and
executing the code for analyzing and processing orders and
quotes, wherein the code, when executed:
( e )(i) automatically activates the third interface to receive
an away market quote from an away market center for a specified
option series on the market center computing system;
( e )(ii) automatically activates the away market quote
engine to analyze the received away market quote to determine
whether the away market quote has moved away from a price of
an automatically repriceable order on an opposite side of the
order book;
( e )(iii) responsive to the away market quote engine
determining that the away market quote has moved away from
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the price of an automatically repriceable order on the opposite
side of the order book:
( e )(iii)(A) causes the away market quote engine to
automatically send a notification to the order matching engine;
( e )(iii)(B) activates the order matching engine, upon
receipt of the notification from the away market quote, to
automatically evaluate the automatically repriceable order to
determine whether the automatically repriceable order can be
repriced more aggressively; and
( e )(iii)( C) causes the order matching engine to
automatically reprice the automatically repriceable order to a
more aggressive price when it is determined that the evaluated
automatically repriceable order can be repriced more
aggressively,
wherein the order matching engine evaluates and reprices
the automatically repriceable order in response to and only upon
receiving the notification from the away market quote engine.
App. Br. 28 (Claims Appendix).
THE REJECTION
The Examiner rejected claims 50-60 and 70 under 35 U.S.C. § 101 as
directed to patent-ineligible subject matter. Final Act. 12-14.
ANALYSIS
THE REJECTION UNDER 35 U.S.C. § 101
Claims 5 0-60 and 70
Based on the record before us, we are persuaded that the Examiner
erred in rejecting claims 50-60 and 70 as directed to patent-ineligible subject
matter.
The Supreme Court, in Alice, reiterated the two-step framework
previously set forth in Mayo Collaborative Services v. Prometheus
Laboratories, Inc., 132 S. Ct. 1289, 1300 (2012), "for distinguishing patents
that claim laws of nature, natural phenomena, and abstract ideas from those
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that claim patent-eligible applications of those concepts." Alice Corp. Pty.
Ltd. v. CLS Bank Int'!, 134 S. Ct. 2347, 2355 (2014). The first step in that
analysis is to "determine whether the claims at issue are directed to one of
those patent-ineligible concepts" (id.), for example, to an abstract idea. If
the claims are directed to one of the patent-ineligible concepts, the inquiry
proceeds to the second step where the elements of the claims are considered
"individually and 'as an ordered combination'" to determine whether there
are additional elements that "'transform the nature of the claim' into a
patent-eligible application." Alice, 134 S. Ct. at 2355 ( quoting Mayo, 132 S.
Ct. at 1297).
Under the first step of the analysis, the Examiner determines that the
claims are directed to the abstract idea of processing repriceable orders.
Final Act. 12-13. According to the Examiner, this is a longstanding and
fundamental economic principle. Id. The Examiner also maintains that
the present claimed process is merely "an idea of itself." The
present claimed process is similar to the concept of "obtaining
and comparing intangible data "and" comparing new and stored
information using rules to identify options (i.e. obtaining quote
data from away markets and comparing the quote data to price of
repriceable order, and evaluating whether to reprice the orders).
These concepts were found to be abstract concepts by the courts.
Therefore, the present claims are directed to an abstract concept.
Final Act. 13-14.
Under the second step of the analysis, the Examiner determines that
the claims do not add significantly more to the abstract idea. Final Act. 14.
In particular, the Examiner explains that the claims recite generic computer
components: a processor, a memory, an interface, and data structures. Id.
These components, according to the Examiner, "perform basic computer
functions, such as listing orders, obtaining incoming order data, comparing
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prices, evaluating whether to reprice orders (i.e. compare data according to
predefined rules or algorithm), and repricing the repriceable orders (i.e.
manipulate data)." Final Act. 14; see also Final Act. 14 (noting that
paragraph 40 of the Specification describes that the claimed market center
may be performed on a general purpose computer and concluding that the
claimed invention does not improve computer functioning). As such, the
Examiner concludes that "[t]he recitation of the computer elements amounts
to mere instructions to implement the abstract idea on a computer system"
and do "not amount to significantly more than the abstract idea itself." Id.
On the other hand, Appellants allege that this case is similar to
Bascom Global Internet Services, Inc. v. At&t Mobility LLC, 827 F.3d 1341
(Fed. Cir. 2016) where
the ordered combination of limitations describes a particular
arrangement that also improves upon prior art processes and
results in a benefit to end users. In particular, the ordered
combination of limitations describe a novel configuration of two
different and separate engines that perform different functions
( as well as separate data structures and separate interfaces for
different data sources) whose implementation, as discussed
above, enables existing market center systems ( among other
things) to reprice orders while minimizing the impact of away
market quote traffic on other components of the system,
improving the speed and efficiency of the system for repricing
orders. As discussed above, the particular arrangement of the
components of the system also directly benefits the end users, by
providing users faster display of the most up-to-date information
and additional execution opportunities.
Reply Br. 9. Appellants also point out that the claimed improvement of the
claims, namely including a separate away market engine to analyze away
market bids, did not exist in the prior art systems. Id. Appellants then
conclude that "because the claimed invention improves upon prior art
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processes and benefits the end users, the claims are patent eligible under
BASCOM."
We are persuaded that the Examiner erred in rejecting the claims as
directed to patent ineligible subject matter. While we agree with the
Examiner that the individual limitations are well-known, routine, and
conventional components, "an inventive concept can be found in the non-
conventional and non-generic arrangement of known, conventional pieces."
Bascom, 825 F.3d at 1350.
Appellants outline how the claims include the inventive concept of
separating the away market engine that improves the functioning of the
computing system itself. App. Br. 8. As Appellant explains, a problem
arose in electronic trading to receive "far more quotes being received than
orders" and "a need arose for an electronic platfoml that minimizes the
impact of away market best bid and offer quote traffic on other components
of the system." Reply Br. 5. Appellants describes that the claimed
away market quote engine 23a only notifies order matching
engine 21 of price shifts that may affect the order book. Away
market quote engine 23a does not notify order matching engine
21 of away market quote traffic that does not affect the order
book. In this manner, order matching engine 21 can proceed with
its normal order matching functions without having to perform
additional computational processing functions (i.e., repricing
evaluation), unless instructed to do so by away market quote
engine 23a.
App. Br. 7. Thus, the claimed separate away market quote engine
minimizes the impact of away market BBO quote traffic on other
components of the system, particularly in regard to the ability of
the system to display and execute orders and quotes with
maximum speed and efficiency.
App. Br. 7; see also App. Br. 9; Spec. ,r,r 6, 11.
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The Examiner fails to address these arguments. For example, the
Examiner separately considers the order matching engine and the away
market quote engine, but fails to consider the claimed ordered combination.
See Ans. 5. Rather, the Examiner generally asserts that "separating
components vs. integral component are well known in the computer art" and
analogizes this to different departments of a company specializing in a
specific function and that it is known this is more efficient. Ans. 5. The
Examiner's reasoning does not consider the context of the claims, namely
whether it was conventional to separate the away market engine. Moreover,
the Examiner does not consider the ordered combination of limitations in
that the claims not only separate the away market engine, but limit the
impact of the away market on other market center systems by limiting
repricing under particular conditions.
Namely, the ordered combination of the claims, including both the
separation of the away market engine and the repricing function under
particular conditions "enables existing market center systems ( among other
things) to reprice orders while minimizing the impact of away market quote
traffic on other components of the system." Reply Br. 9. The particular
arrangement claimed, therefore, "improve[ s] an existing technological
process" by minimizing the away market quote traffic. Alice, 134 S. Ct. at
2358. As such, we are persuaded that the Examiner erred in rejecting the
claims as directed to patent ineligible subject matter. See Bascom, 827 F .3d
at 1349-50 (finding the claims patent eligible because "the patent describes
how its particular arrangement of elements is a technical improvement over
prior art ways of filtering such content."); see also Amdocs (Israel) Limited
v. Openet Telecom, Inc., 841 F.3d 1288, 1300-01 (2016) (approving a claim
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that "requires arguably generic components" but also "necessarily requires
that these generic components operate in an unconventional manner to
achieve an improvement in computer functionality"); Trading Technologies
International, Inc. v. CQG, Inc., 675 F. App'x 1001 (Fed. Cir. 2017)
(unpublished)(finding of patent eligibility with respect to step two of Alice
when the claims provided "an inventive concept that allows traders to more
efficiently and accurately place trades using this electronic trading system.").
Accordingly, we reverse the Examiner's rejection of claims 50-60 and
70 as directed to non-statutory subject matter.
DECISION
We reverse the Examiner's decision to reject claims 50-60 and 70.
REVERSED
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DISSENTING OPINION
CRAIG, Administrative Patent Judge.
I respectfully dissent. In my view, the Examiner did not err in
rejecting the claims as directed to patent ineligible subject matter. I agree
with the Examiner that the claims do not include limitations that amount to
"significantly more" than the abstract idea because the claims do not include
an improvement to another technology or technical field, an improvement to
the functioning of the computer itself, or meaningful limitations beyond
generally linking the use of an abstract idea to a particular technological
environment. See Final Act. 12.
Appellants argue that, because the claimed invention improves upon
prior art processes and benefits the end users, the claims are patent eligible
under Bascom. Reply Br. 9 ( citing Bascom Global Internet Services, Inc. v.
At&t Mobility LLC, 827 F.3d 1341 (Fed. Cir. 2016)). In particular,
Appellants argue that the claimed system performs functions that are not
merely generic because they minimize the impact of away market BBQ
quote traffic, "thereby improving the speed and efficiency of the system to
display and execute orders/quotes, including additional execution
opportunities provided by repricing." App. Br. 21. Appellants also argue
that the novel configuration of the two recited engines "enables existing
market center systems ( among other things) to reprice orders while
minimizing the impact of away market quote traffic on other components of
the system, improving the speed and efficiency of the system for repricing
orders." Reply Br. 9.
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Here, the claims recite no details about how some computer
functionality is performed more efficiently such that it (a) takes that
computer functionality out of the world of "generic" and/ or (b) leads to an
improvement in the functioning of the computer itself. For example, the
alleged technological improvement is an efficiency in "other components of
the system," but those components and improvements are not claimed or
detailed.
Instead, the recited computer components (e.g., "computing system,"
"processor," "data structures," "memory," "order matching engine," "away
market quote engine") are recited at a high level of generality such that the
claims recite generic computer components performing generic computer
functions that are well-understood, routine and conventional activities. See
Ans. 12. The argued improvement is really an improvement of the
underlying economic practice itself, rather than a technological improvement
of the computer system that implements the underlying economic practice.
Such an improvement does not constitute an improvement to the
functionality of the underlying computer system or computer technology.
For these reasons, I am not persuaded that the Examiner erred in
determining that the recitation of separate data structures and separate
engines in claims does not amount to significantly more than the abstract
concept. See Ans. 3-7.
Accordingly, I would affirm the Examiner's rejection of claims 50-60
and 70 under 35 U.S.C. § 101. See Final Act. 12-14; Ans. 2.
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